3 Responses to “Should You Call or Send?”

Hey Dan First of all thank you for all the support you provide. I have an opportunity to buy some cleaning accounts from a very good friend of mines niece. She does strictly residential and has been at it for a few years but now she has chosen another opportunity and is willing to sell her clients (business) to me. I am not opposed to this because it falls within my realm of commercial and residential cleaning. My concerns are what she charges, what she provides, is there a contract and the location. I can look at what she has and with asking questions will know if it will work with my current conditions. My question is if I am able to accept her current clients with some modification to a contract what do I offer for this. I have never purchased clients from an existing business and do not know what would be fair. I would think a percentage of each clients yearly sales would be a good start and pay her a percentage of what that gross is to buy her out. Is there a percentage number to work with that would help me with this equation? I am looking at 15% with the figires I came up with.
Thanks again

Well, this is one area where I unfortunately may not be of much help. Tony and I never bought a cleaning account. A couple of times we briefly considered it, but quickly dismissed the idea because we felt we were adding profitable accounts at an acceptable pace and didn’t want to deal with the ‘unkowns’ and potential problems that could go along with buying someone else’s cleaning jobs.

The only similar experience we had was after 20 years in business – selling our own cleaning company, and in that case, we worked with an experienced business broker/CPA who went through a lengthy process of analysis or our financials followed by the use of detailed formulas to arrive at and assign a final value to the entire business.

I realize other cleaning businesses have been successful in growing by buying cleaning accounts, it’s just that it wasn’t the case with us. The only suggestions I would offere is to 1) protect yourself by performing as much due diligence research as possible and 2) get appropriate legal and accounting counsel if you decide to move forward.

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